Houses go up, Values go down

By: Jay Heinrich


The recent market for new homes in the United States as a whole has taken a hit, and the Texas market is following suit. Accourding to an article in the Austin-American Statesman on October 7th written by Shonda Novak and M.B. Toboada, while homes available for sale across Central Texas were at a four year high this August, sales were down 10 percent.

To me, the solution seems pretty simple. Build less houses, fewer houses sit around without a family. Not so fast, my friend. Apparently, builders have decided to cut back on a miniscule basis. All this has done is keep inventory low and prices up. According to a Texas A&M study, the Texas new home industry will continue on a decline until houses start going up at a much slower rate. So in a way, my theory is correct. However, home builders and building companies need to cut back dramatically instead of microscopically.

Not only are individual home owners/ potential sellers hurting, but big business builders are feeling the pain as well. Subdivisions are coming to a complete halt. Prices are not expected to ease up any time soon either, with prices forecasted to rise in 2008 as well.

Hopefully, home builders will heed warnings and stop building new houses at such a high rate. However, for people worried about the rising prices of a new home, according to Michelle Perris, the broker/owner of Michelle Perris Real Estate, "The sky is not falling, not at all. I think that people will get over the national news, and they're going to be fine." If a potential home buyer or seller believes this, though, i believe they are in for a rude awakening.

Out with the Power Plant in with a Park!

By: Stephanie Kelley

One of the things I look forward to in the upcoming years is the purchase of my first home. I want it to be “perfect”, but in reality I will settle for “affordable”. For some people, an affordable place to live means living in poorer neighborhoods. But what happens when you are affected by the steady rise in property values? Let’s debate…

In last Sunday’s Statesman, an article by M.B. Taboada highlights a positive spin to the closing of the 16-story Holly Power Plant. Once a building that no one wanted to reside around, this land is now set to be an attractive park and residential area. Homes are being sold at record highs. Taboada sites that “Two have already been spoken for, and another will go on the market for $649,000—prices unseen in East Austin just a few years ago.” The addition of these nice homes and condos is attractive for several reasons. No longer having the presence of the power plant is one of the biggest attractions. A new development with a new park with a great locale near Ladybird Lake also help make this a new and exciting part of the development and attempts to raise property values in East Austin.

One of the concerns of certain residents in the area is the fact that adding these nicer homes is going to cause a raise in property taxes. Some people have already reported that they have had to move out of the area already. This part of town has the highest rate of poverty in the city of Austin, so any rise in taxes can potentially be back-breaking. Larry Warshaw, who has helped in several East Austin condominium projects, says that the addition of these new houses will not “have much impact on speculation, or increased real estate. It would be hard to imagine faster appreciation.”

Regardless what side you see to be right or wrong, one thing is certain, and that is the demand for these homes to go up. Austin is ever-growing, a simple fact we will have to face. And as a result, the demand for homes to be built will be constant. When I look at my first home, I will make sure to examine all angles, including the potential for a rise in taxes. However in this ever-growing Austin it looks to be inevitable.


Austin American Statesman
"Neighborhood in Holly Power Plant's shadow undergoing change"
By: M.B. Taboada

The Three Towers?

Showdown at the Planning Commission over Riverside Highrises by: Kate Miller Morton
http://www.statesman.com/blogs/content/shared-gen/blogs/austin/cityhall/entries/2007/10/03/showdown_at_the_planning_commi.html


The newest chapter in the battle over Town Lake will take place Oct. 9th before the Austin Planning Commission. Despite zoning laws capping the distance new structures can be built at two hundred feet from the water, CWS is seeking to build three seventeen story condominiums on E. Riverside. If the board votes against the proposal CWS will convert apartment complexes into three story townhouses through a loop hole in the two hundred foot zoning law.
If allowed to build the condominiums, CWS has promised to extend the hiking trail along the south shore of Town Lake. This promise has helped the proposal to gain the support of some local organizations. If the proposal is denied not only will CWS go ahead with its condos (200 ft from the water), they will convert moderately priced apartments into expensive townhomes and will not build a connection for the hiking trail or donate land to the park.
While a hiking trail that connects from the east and west of i35 would be beneficial for those who use the trail, it is, in my opinion, not worth the destruction of affordable housing for the residents of South Austin. There are other ways to connect the hiking trail without building a seventeen story condo right beside it. Not only do high rise condos increase the cost of living for those in the central and south downtown areas, but it causes the price of other low income areas to increase resulting in a shortage of affordable housing.
There is also a disturbing precedent which will be set if the board approves CWS's proposal. If all a development company has to do to sidestep Austin's zoning laws is throw a small portion of land at it then all control over housing and real estate will be lost. An approval will send the message that the future culture of Austin is for sale to the highest bidder. In my opinion, no length of bike trails is worth that.

Samuel Paul Wyser

East Austin Wins the Fight to Become Powerless

A power plant in East Austin was finally laid to rest after almost a decade of neighbors trying to turn off its lights. The power plant was built in the '60s and early '70s and consisted of four cells. The Holly Power Plant was a natural gas burning power plant that produced approximately 358 MW of energy. Although the plant's production has been shut down, the lifeless structure could take up to two years to come down.

The concern of the locals was that the PCBs and high sulfur burning could cause adverse health effects. A study done by the Texas Department of Public Health in 1999 did not find any conclusive evidence. They stated in the report that:

Data are not available to determine if rates of respiratory illnesses or other health problems are higher in the neighborhood around the Holly Street Power Plant. According to available data, the only time that the plant would be likely to produce contaminants associated with respiratory illness would be on the occasions when it burned high sulfur content fuel oil. Based on the air modeling results, it is possible that when high sulfur content fuel was burned in the past, sulfur dioxide levels could have been high enough to temporarily affect sensitive individuals. The voluntary conversion to a low sulfur content fuel oil should ensure that sulfur dioxide emissions remain below the levels potentially able to cause adverse reactions in sensitive individuals. Under current operating conditions, it is not likely that the plant would be responsible for increased rate of respiratory illnesses or other health problems.

Although the same report also stated this:

For the years 1989 to 1992 the lung cancer experience for African American males and White females living in this zip code area is significantly greater than would be expected.

The fight to remove the plant started in the early '90s and officials said the plant would be retired as soon as it was practical. Energy alternatives have been found and now the plant can now be put to rest. The residents around the Holly Power Plant held a candle light vigil Sunday night when the plant was shut down. Although the residents were happy about the plant being shut off, they weren't happy about the rumor of condos taking the plant's place. Luckily though, officials are throwing $18 million of our money at the project of turning the land into dedicated park land.

So through it all, I am proud of the neighbors of the Holly Power Plant for fighting for alternative energy sources and trying to improve the air quality where they live. Although the reports that I found on the power plant (all one of them) contradicted itself many times; a power plant next to a residential neighborhood is never a good thing to have. Hopefully more communities will be fighting for cleaner air in their area, leading to alternative energy sources.

Article: http://www.news8austin.com/content/top_stories/default.asp?ArID=192851
Report: http://www.atsdr.cdc.gov/HAC/PHA/aus/aus_p2.html

-Gregory

"Will I ever be able to afford a house in Austin?"

By Stephanie Kelley

Problems continue to challenge young home buyers in the Austin. As if it wasn’t hard enough to establish long-term assets like a first home, a recent article on statesman.com sheds light on the decrease in home sales in comparison to this point last year. The article, written by Statesman staff writer M.B. Taboada, shows how raising credit standards for mortgages might be one contributing factor to why home sales are down 10% from last year.

Taboada shows the most compelling stat, stating “the slowdown in sales was steepest for homes priced below $200,000, which makes up more than half of the Central Texas market.” As a college student or recent graduate, a first home usually falls into this category, and combined with the growing difficulty for younger people to get mortgages, we are left with more and more houses sitting on the market. Even though there are more houses on the market, the price is not going down. Due to steady population increases in Central Texas, these homes will remain solid in their value, regardless of the current declining trend.

Some real estate investors don’t view the situation as being quite as grim. After all, they more than likely have the opportunity to sell homes in various markets, worth, etc. But is the market forgetting the little people? Compared to other big cities like San Antonio and the DFW, where they saw declines of 13% and 7% respectively, Austin’s decline seems almost minuscule.

I feel concerned about this topic for a couple of reasons. With the median price for a house being over $192,000, I begin to wonder how and if I am ever going to be able to afford my first home. As long as more and more people move into the area making more money than I do, the price of homes does not look like it’s going to decrease anytime soon. And combined with the “tighter credit standards”, another way of saying the market is catering towards the wealthy, young home buyers and future home buyers like myself are left feeling overwhelmed.

Article: Austin housing market slowing

Sales in August were down 10 percent from previous year, but prices still rising

http://www.statesman.com/search/content/business/stories/realestate/09/25/0925homesales.html

By M.B. Taboada

Austin American Statesman

Tuesday, September, 25th 2007

Wastewater Plan Could Put Bear Creek in a Stinky Situation.

Dumping up to 500,000 gallons of wastewater per day into Bear Creek is a horrible idea, at least according to the residence of the area. Hays County Water Control and Improvement District #1 has requested a discharge permit that will allow them to dump up to 500,000 gallons of wastewater into Bear Creek to be able to keep up with current and future development. This could be the first time that discharging of waste water has been allowed in the Barton Springs section of the Edwards Aquifer.

Now at first glance my initial reaction was that of a teenage girl watching a horror movie for the first time. How could they pollute Bear Creek like that? Don't they think of all the wildlife that lives there and the impact it will have on the ecosystem in the area? Apparently I wasn't alone in this thought; the residents of the area have formed a group to protect Bear Creek.

After the initial shock of the whole situation has worn off I decided to dig into the story a little bit more because the article seemed bias after reflecting on what I had read.

According to the Hays County Water Control and Improvement District #1's website the water isn't wastewater so much as treated water. Wastewater gives the impression of steaming untreated sewage flowing out of an oversized pipe and pouring into a fresh lake. Treated water, on the other hand is various types of wastewater that has been cleaned and purified. In fact, the water is required to meet or exceed the state’s safety and quality standards for Type I reclaimed water, deeming it safe for humans and wildlife alike.

The Hays County Water Control and Improvement District also stated that it has no intention of dumping anywhere near 500,000 gallons of reclaimed water a day. The only reason that figure comes into play is because they permit requires them to apply for the worst case scenario amount.

Though [dumping 500,000 gallons a day] almost certainly will never occur, the Water District's responsible plan and scientific analysis is based on that possibility, which adds up to the 500,000 gallon figure.

With everything taken into account, this seems essential in the movement to keep up with current and future development and actually helps the environment by recycling wastewater for irrigation. The people living in the Bear Creek area won't be waist deep in sewage any time soon.

News 8 Article: http://www.news8austin.com/content/headlines/?ArID=192580&SecID=2
Hays County Water Control and Improvement District #1: http://hayscountywater.com/

-Gregory

Highrise Could Tower Over Historical Neighborhood

By: Jay Heinrich



Two recent articles in the Austin-American Statesman have two very different ideas of living. While one article almost makes me brace myself for the upcoming possible traffic increases and over-crowding of our downtown area here in Austin, the other brings a smile to this small town guy's face and brings to light a philosophy that could help keep a neighborhood from being further engulfed by the ever-expanding downtown area.


A September 20 article written by Shonda Novak is full of facts about one of the many new condo highrises going skyward in downtown Austin, including its negatives. A more recent article written on September 23 by John Egan has a different feel to it. That's because Egan's article brings to the reader's attention a different kind of living on ranches far, far away from any highrise skyscraper.



The new condo highrise is proposed to be built on West Avenue between 8th and 9th streets. According to the article, in an area where zoning laws currently cap the height of a building at 60 feet, lobbying is taking place by David Cox, president of Fortis Development, which is an Austin located business, to raise that limit to 250 feet, or about 20 stories. It is mentioned that many residents in this neighborhood have voiced their opinion that such a building would fail to "fit with the residential and historic character of the area."





Ummm.... you think? That's like saying next to DKR Texas Memorial Stadium the University of Texas will build a shrine to Texas A&M mascot Reveille and expect it to fit in. It's just not going to happen.



On the other hand, Egan writes of a thriving ranch land industry. One of the examples given is the land belonging to former high-tech executives and former Austinites Bill and Elaine Swiss. The Swisses have moved from the city out to a more comfortable Hill Country ranch out near Round Mountain. Mr. Swiss knows he is quite blessed of his good fortune to own the land he does, especially with prices for Central Texas ranch land ranging anywhere from $4,000 to $20,000 and acre. Purchasing a large amount of ranch land is quite a large investment. However, as long time veteran ranch broker Sherman Durst put it, "Today's buyer is not making a living off of the land." To me, that is what makes this type of living great.



Imagine buying a property and improving it to make it more beautiful and more peaceful to live. The Swisses daily happenings around the ranch include clearing unwanted trees, mowing grass, feeding horses, and hauling ranch supplies around. Their everyday tasks do not include building upwards 20 stories and possibly creating traffic problems for others around if, as Novak writes, market conditions change and residential highrises are turned into business offices.



At the end of Egan's piece on the ranches, Bill Swiss, when speaking of his ranch, said, "We have the joy of not doing anything if we want, which is a delight." Here's hoping David Cox and other developers follow Swiss's sometime philosophy and decide to "not do anything" in this particular neighborhood and build their highrises elsewhere.







Egan Link: http://www.statesman.com/business/content/business/stories/statesmanhomes/09/23/0923ranches.html



Novak Link:
http://www.statesman.com/business/content/business/stories/realestate/09/20/0920downtown.html